Retail Property to Rent

It doesn’t take a property genius to work out the high street is currently in decline but the out of town retail sheds are also taking a battering in the current tough economic climate with big retailers like Halfords and Carpetright giving severe profit warnings, so what is the outlook for potential retailers before committing to a retail property to rent?

Who will fill these A1 (the use class for high street retail)spaces?   There seems to be little shortage of A3 (restaurant and pubs) and A4 (hot food takeaway) with outlets like Subway often opening 4 -5 outlets in one medium sized city alone.   Starbucks has had to reinvent itself from the top downwards in order to stay ahead of the countless designer coffee outlets and Costa Coffee is snapping on its heels.  Have coffee houses reached saturation or is there still potential for high street low cost retail property to rent?

One interesting example is Shakeaway which started with a single outlet in Bournemouth and is now in outlets across the south of England.  Their units are very low budget fitouts and staffed by very young student looking staff with plenty of face furniture and gaudily coloured hair.  However, their retail property to rent offering is unbeatable.  It is shake in which milk and vanilla ice cream are blended with your confectionary of choice including such bizarre additions as refreshers or Haribos.  I am always impressed with the frequent queues out of their units so they seemed to have found tapped into the Zeitgeist of current beverage trends.

Another favourite example of mine is Lush Cosmetics with its extraordinary prevalent aroma of hand blended cosmetics and its strong no animal testing ethos, all of their staff are bordering on evangelical devotion to the Mark and Mo Constantine cult.  They have filled the void left when Anita Roderick sold out her Body Shop to L’Oreal , a fact still incomprehensible to those who knew her and her principles. However, the luxury prices in Lush’s outlets must have been hard hit as the recession has bitten deeper into people’s pockets.

Retail Property To Rent

Renting is still the only option for most would be retail tenants but the terms on offer are very flexible indeed.   I am told by many agents that most Landlords are dropping requirements for rent deposits and 3 months rent in advance in the current climate as most landlords are just glad to have tenants to fill their rental voids.  Whilst this may be good news for startup tenants, it does not reflect a healthy sector.

Tenants are also successfully negotiating break options coinciding with rent reviews which must take the sting out of any over zealous landlord surveyor who thinks he is still back in the bullish days of 10 years ago.

Can the high street survive as an economic identity?   Are we going to have bleak high streets like you currently find in depressed urban sub districts where the only survivors are pawnshops, late night takeaways, taxi offices, off licences behind cages and endless discount outlets ?

If you still want to commit to a retail property to rent, then subscribe to my property investing course in the right hand margin of this post.

One Response to “Retail Property to Rent”

  • As shop fitters we’ve noticed the trend of unpopulated retail spaces going to book keepers such as Ladbrokes.
    There’s no shortage of them popping up to keep the likes of Starbucks and Costa fighting over space.

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Dominic Beeton, Solicitor
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